John Lewis faces fee backlash as brands reconsider their stock

·2 min read
CHEADLE, ENGLAND- MARCH 12: A lady walks past a closed John Lewis department store on March 12, 2021 in Cheadle, England. (Photo by Nathan Stirk/Getty Images)
Retail stores have been under intense pressure during the pandemic as their bottom lines were squeezed by lockdowns and consumer confidence was dented. Photo: Nathan Stirk/Getty Images

Department store chain John Lewis is facing a backlash from brands, who are claiming the fees charged to stock their products are "ridiculous". 

The issue has become more acute as its model comes under threat from cheaper online marketplaces which have fewer bricks and mortar overheads, according to a report in the Sunday Times. 

The Times reported that the brand's chairwoman Dame Sharon White has brought in Alix Partners to renegotiate with suppliers. Brands pay it up to 50% of every sale in commissions and fees. 

One fashion brand, Seasalt, decided to cut ties with John Lewis saying it would push its offering in Marks & Spencer and Next instead. The Times reported that two other unnamed brands had negotiated discounts to the rates. 

Retail stores have been under intense pressure during the pandemic as their bottom lines were squeezed by lockdowns and consumer confidence was dented. 

In March the employee-owned parent John Lewis Partnership said it was not planning to reopen eight of its 42 John Lewis shops from lockdown, adding to eight closures last year.

Read more: UK travel companies plot 'day of action' as pressure mounts to ease COVID rules

The moves to hike fees comes following a top-level shakeup at the brand. In May, there were a host of new senior appointments — including bringing in a "store of the future" director.

It said it appointed Stephen Spencer, currently director real estate, store development and strategic sales at athleisure brand Lululemon, as director of store of the future for John Lewis.

This came alongside plans to invest £50m in johnlewis.com this year as shoppers continue to buy online.

A spokesperson for John Lewis said: “The review looks at a range of themes such as marketing and shop space, as well as fees.

"We build trusting and fair relationships that benefit John Lewis and our suppliers. In the last six months, we’ve introduced 90 new Fashion brands, which demonstrates that we are an attractive partner to our suppliers.”

Watch: COVID-19: UK economy 'will bounce back to pre-pandemic levels by end of 2021' - despite delay to end of lockdown

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